US Deficit Explained

by James & Miel on June 10, 2009 · 0 comments

Good Morning,

At the gym this morning I got a tip off on a couple of pieces in the New York Times about the US deficit; a Sea of Perilous Red Ink, Years in the Making and How We Crunched the Deficit Numbers, by David Leonhardt.

The first article goes in to depth about how the US went from an anticipated $800 billion annual surplus from in between 2009 and 2012, to what now has turned out to be a $1.2 trillion annual deficit during that same period. The reps in Washington definitely are not taking the frugal approach when it comes to managing their(our?) money.

NY Times breaks down that $2 trillion dollar swing into the following chunks:
37% comes from the general budget cycle made worse by the economic crisis
33% comes from Bush style taxcuts and medicare legislation
20% comes from policies put into place by Bush and continued by Obama, namely tax cuts for those under $250k and the continuation of the Iraq war
7% comes from the 2009 stimulus
3% Mr. Obama’s agenda on health care, education, energy and other areas

The second article explains the methodology behind this analysis. Both articles are well worth checking out.

Happy Reading,

Miel

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